Revenue for the third quarter was $868 million, up 8% at constant currency from the prior-year quarter and up 7% including the negative impact of foreign exchange. Both adjusted and GAAP earnings per share from continuing operations were $1.30, compared to $0.97 in the prior-year quarter, up 34% to a record GAAP EPS.

"Lennox International's strong business momentum continued in the third quarter, with revenue up 8% from the prior-year quarter at constant currency and total segment profit margin up 190 basis points to a record level of 11.9%," said Chairman and CEO Todd Bluedorn. "In our Residential business, revenue was up 13% at constant currency, led by strong double-digit growth in replacement business with favorable price and mix. Residential margin expanded 330 basis points to 13.1%. Residential profit grew 51%. In our Commercial business, revenue was up 8% at constant currency, led by strong growth in national account equipment and services, as well as continued momentum in the emergency replacement market. Commercial profit grew 21% as segment margin expanded 160 basis points to a record 16.4%. In Refrigeration, global market conditions remained choppy. Revenue was down 2% at constant currency on soft market conditions in Australia and Europe. North America was up slightly, and China and South America saw strong growth. Refrigeration profit was down 5%. Refrigeration margin was flat at 12.3%. For the company overall in 2013, given our strong performance year-to-date and current outlook, we are reiterating our revenue growth guidance of 6-8% and raising the low end of adjusted EPS from continuing operations guidance to $3.50-$3.75. Looking ahead, the company remains strategically well-positioned to capitalize on growth in our major end markets and drive increased profitability through our key operational initiatives."

FINANCIAL HIGHLIGHTS

Revenue: Revenue for the third quarter was $868 million, up 7% from the prior-year quarter. Foreign exchange had a negative 1 point impact. Volume and price/mix were up from the prior-year quarter.

Gross Profit: Gross profit for the third quarter was $237 million, up 16% from the prior-year quarter. Gross margin was 27.4%, up 210 basis points from 25.3% in the prior-year quarter. Gross profit was primarily impacted by higher volume, favorable price/mix and lower material costs, partially offset by investments in distribution.

Income from Continuing Operations: Adjusted income from continuing operations in the third quarter was $65.5 million, or $1.30 per share, compared to $49.7 million, or $0.97 per share, in the prior-year quarter. Adjusted earnings from continuing operations for the third quarter of 2013 excludes a special legal contingency charge of $0.5 million after-tax, $0.7 million after-tax for the net change in unrealized gains on unsettled futures contracts, and a $0.1 million gain after-tax for other items, net.

On a GAAP basis, income from continuing operations for the third quarter was $65.8 million, or $1.30 per share, compared to $49.7 million, or $0.97 per share, in the prior-year quarter.

Free Cash Flow and Total Debt: Net cash from operations in the third quarter was $153 million, compared to $75 million in the prior-year quarter. The company invested $18 million in capital assets in the third quarter. Free cash flow was approximately $136 million, compared to $63 million in the prior-year quarter. Total debt at the end of the third quarter was $435 million, and total cash and cash equivalents were $38 million. The company paid $12 million in dividends and repurchased $33 million of stock in the third quarter.

BUSINESS SEGMENT HIGHLIGHTS

Residential Heating & CoolingThird quarter 2013 revenue in the Residential Heating & Cooling business segment was $434 million, up 12% from the prior-year quarter. Foreign exchange had a negative 1 point impact on revenue growth. Segment profit was $57 million, up 51% from the prior-year quarter. Segment profit margin was 13.1%, up 330 basis points. Results were primarily impacted by higher volume, favorable price/mix, and lower material costs, with partial offsets from higher SG&A and investments in distribution expansion.

Commercial Heating & CoolingRevenue in the Commercial Heating & Cooling business segment was $239 million in the third quarter, up 9% from the prior-year quarter. Foreign exchange had a positive 1 point impact on revenue growth. Segment profit was $39 million, up 21% from the prior-year quarter. Segment profit margin was 16.4%, up 160 basis points. Results were primarily impacted by higher volume and lower material costs, with partial offsets from higher SG&A and investments in distribution expansion.

RefrigerationRevenue in the Refrigeration business segment was $195 million in the third quarter, down 4% from the prior-year quarter. Foreign exchange had a negative 2 point impact on revenue. Segment profit was $24 million, down 5% from the prior-year quarter. Segment profit margin was flat at 12.3%. Results were primarily impacted by lower volume and SG&A investments, with a partial offset from lower material costs.

FULL-YEAR OUTLOOK

The company is reiterating its revenue growth guidance and raising the low end of its EPS from continuing operations guidance for 2013.

Reiterating revenue growth guidance of 6-8%; foreign exchange is still expected to have a neutral impact on revenue on a full-year basis.

Raising the low end of adjusted EPS from continuing operations guidance from $3.45-$3.75 to a range of $3.50-$3.75.

Raising the low end of GAAP EPS from continuing operations guidance from $3.38-$3.68 to a range of $3.43-$3.68.

Reiterating tax rate guidance of 34-35% on a full-year basis.

Reiterating capital expenditure guidance of approximately $60 million in 2013.

Raising stock repurchase guidance from $100 million to $125 million for 2013, including plans to repurchase $59 million in the fourth quarter.

Reiterating average diluted share count guidance of approximately 51 million shares for the full year.

CONFERENCE CALL INFORMATION

A conference call to discuss the company's third quarter results will be held this morning at 8:30 a.m. Central time. To listen, dial the conference call line at 612-332-0630 at least 10 minutes prior to the scheduled start time and use reservation number 303703. The conference call will also be webcast on Lennox International's web site at www.lennoxinternational.com.

A replay will be available from 11:00 a.m. Central time on October 21 through October 28, 2013 by dialing 800-475-6701 (U.S.) or 320-365-3844 (international) and using access code 303703. The call will also be archived on the company's web site.

Lennox International Inc. is a global leader in the heating, air conditioning, and refrigeration markets. Lennox International stock is traded on the New York Stock Exchange under the symbol "LII." Additional information is available at: http://www.lennoxinternational.com or by contacting Steve Harrison, Vice President, Investor Relations, at 972-497-6670.

The statements in this news release that are not historical statements, including statements regarding expected financial results for 2013, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are subject to numerous risks and uncertainties that could cause actual results to differ materially from the results expressed or implied by the statements. Risks and uncertainties that could cause actual results to differ materially from such statements include, but are not limited to: the impact of higher raw material prices, LII's ability to implement price increases for its products and services, the impact of unfavorable weather, a decline in new construction activity and the related demand for products and services, and those factors listed in Item 1A of LII's Annual Report on Form 10-K for the year ended December 31, 2012 (the "10-K"), which are incorporated by reference. For information concerning these and other risks and uncertainties, see the 10-K and LII's other publicly available filings with the Securities and Exchange Commission. LII disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

LENNOX INTERNATIONAL INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(In millions, except per share data)

For the Three Months Ended September 30,

For the Nine Months Ended September 30,

2013

2012

2013

2012

Net sales

$

868.0

$

809.7

$

2,449.5

$

2,264.5

Cost of goods sold

630.6

604.8

1,796.1

1,710.6

Gross profit

237.4

204.9

653.4

553.9

Operating Expenses:

Selling, general and administrative expenses

136.9

125.9

424.0

379.8

Losses (gains) and other expenses, net

(0.3)

0.3

2.8

0.2

Restructuring charges

0.3

0.4

3.2

3.1

Income from equity method investments

(3.3)

(2.6)

(10.7)

(8.8)

Operational income from continuing operations

103.8

80.9

234.1

179.6

Interest expense, net

3.8

4.4

10.8

13.4

Other expense (income), net

—

—

(0.1)

0.1

Income from continuing operations before income taxes

100.0

76.5

223.4

166.1

Provision for income taxes

34.2

26.8

77.5

57.6

Income from continuing operations

65.8

49.7

145.9

108.5

Discontinued Operations:

Loss from discontinued operations before income taxes

(2.3)

(24.6)

(15.7)

(57.2)

Benefit from income taxes

(0.8)

(4.3)

(6.4)

(16.7)

Loss from discontinued operations

(1.5)

(20.3)

(9.3)

(40.5)

Net income

$

64.3

$

29.4

$

136.6

$

68.0

Earnings per share – Basic:

Income from continuing operations

$

1.32

$

0.98

$

2.92

$

2.13

Loss from discontinued operations

(0.03)

(0.40)

(0.19)

(0.79)

Net income

$

1.29

$

0.58

$

2.73

$

1.34

Earnings per share – Diluted:

Income from continuing operations

$

1.30

$

0.97

$

2.87

$

2.11

Loss from discontinued operations

(0.03)

(0.40)

(0.18)

(0.79)

Net income

$

1.27

$

0.57

$

2.69

$

1.32

Average shares outstanding:

Basic

49.7

50.6

50.0

50.8

Diluted

50.5

51.3

50.8

51.5

Cash dividends declared per share

$

0.24

$

0.20

$

0.68

$

0.56

LENNOX INTERNATIONAL INC. AND SUBSIDIARIES

SEGMENT NET SALES AND PROFIT (LOSS)

(Unaudited)

(In millions)

For the Three Months Ended September 30,

For the Nine Months Ended September 30,

2013

2012

2013

2012

Net Sales

Residential Heating & Cooling

$

433.9

$

386.3

$

1,224.5

$

1,070.7

Commercial Heating & Cooling

239.1

219.7

631.8

597.9

Refrigeration

195.0

203.7

593.2

595.9

$

868.0

$

809.7

$

2,449.5

$

2,264.5

Segment Profit (Loss) (A)

Residential Heating & Cooling

$

57.0

$

37.7

$

143.7

$

90.7

Commercial Heating & Cooling

39.2

32.5

84.8

74.1

Refrigeration

23.9

25.1

66.5

60.6

Corporate and other

(16.6)

(14.3)

(56.2)

(43.7)

Subtotal that includes segment profit and eliminations

103.5

81.0

238.8

181.7

Reconciliation to Income from continuing operations before income taxes:

Special product quality adjustments

(0.4)

0.9

(0.5)

1.0

Items in Losses (gains) and other expenses, net that are excluded from segment profit (loss) (B)

(0.2)

(1.2)

2.0

(2.0)

Restructuring charges

0.3

0.4

3.2

3.1

Interest expense, net

3.8

4.4

10.8

13.4

Other expense (income), net

—

—

(0.1)

0.1

Income from continuing operations before income taxes

$

100.0

$

76.5

$

223.4

$

166.1

(A) The Company defines segment profit and loss as a segment's Income or Loss from continuing operations before income taxes included in the accompanying Consolidated Statements of Operations, excluding:

Special product quality adjustments;

Items in Losses (gains) and other expenses, net that are noted in (B);

Restructuring charges;

Goodwill, long-lived asset and equity method investment impairments;

Interest expense, net;

Other expense (income), net.

(B) Items in Losses (gains) and other expenses, net that are excluded from segment profit or loss are the net change in unrealized gains and/or losses on unsettled future contracts, special legal contingency charges and other items.

LENNOX INTERNATIONAL INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In millions, except shares and par value)

As of September 30, 2013

As of December 31, 2012

(unaudited)

ASSETS

Current Assets:

Cash and cash equivalents

$

37.8

$

51.8

Accounts and notes receivable, net of allowances of $9.3 and $9.5 in 2013 and 2012, respectively

489.2

373.4

Inventories, net

430.0

374.8

Deferred income taxes, net

29.5

27.5

Other assets

50.8

61.0

Assets of discontinued operations

—

98.6

Total current assets

1,037.3

987.1

Property, plant and equipment, net of accumulated depreciation of $615.8 and $584.8 in 2013 and 2012, respectively

To supplement the Company's consolidated financial statements and segment net sales and profit presented in accordance with U.S. GAAP, additional non-GAAP financial measures are provided and reconciled in the following tables. The Company believes that these non-GAAP financial measures, when considered together with the GAAP financial measures, provide information that is useful to investors in understanding period-over-period operating results. The Company believes that these non-GAAP financial measures enhance the ability of investors to analyze the Company's business trends and operating performance.

Reconciliation of Income from Continuing Operations, a GAAP measure, to Adjusted Income from Continuing Operations, a Non-GAAP measure